Areva Resources Namibia Ltd. is undertaking a project involving the construction of a seawater desalination plant at Wlotzkasbaken near Swakopmund. The directors of Areva believe their multimillion dollar project shall be able to supply all the water to be consumed at Trikkopje mine, some 40km into the dessert. This project shall be financed using funds raised in the Namibian market. The cash flow from the selling of uranium concentrate begins weeks from the commencement of the project and such cash flow shall be invested short term in order to be ploughed back into the project when needed. The companys return for the first six months is estimated to be 14%. Its equity multiplier is 1.2 and the total assets exceed NS5O Million. As part of their financial strategy, the directors shall invest NS200 000 with Old Mutual at the beginning of every quarter. The target is to reach NS2 000 000 in two years time from the Old Mutual investment. The investment yields annual returns of 8% compounded quarterly. One of the directors is of the opinion that they should use their connections at Old Mutual to get a fair deal on their investment but in return of some fees payable to their connections while one other director does not really care whatever interest they will be charges arguing that it will not benefit them individually. Required: a) Identify and explain the type of market from which Arevas directors will raise funds for their desalination plant. (4) b) Advise the management of Areva Resources of any three short term securities which they can buy in Namibia. Explain each of these securities. (6) c) Do directors act in the interest of the shareholders always? Explain. (3) d) What other four legitimate goals can the company pursue other than wealth maximization? (4) e) What is the annual return of Areva Resources Ltd.? (2) f) Determine the debt to equity ratio and the total debt ratio of the company. (4) g) Will the company be able to reach their target of NS2 000 000 in 2 years? If not, how much more should they deposit quarterly to reach this target?